The packaging industry continues to face several challenges from a range of factors in 2022 including increased costs, supply-chain shortages, and labor shortages.The current problems plaguing the industry have created the perfect recipe for disaster, that will likely last for the foreseeable future. In this article, we examine the challenges, effects, and how Korpack is navigating these troubling times to help our clients keep their businesses afloat.
The Rising Cost of Materials
There are many reasons behind the rising cost of packaging materials including container and labor shortages, raw material shortages, and the COVID-19 pandemic.
When the COVID-19 pandemic hit, government-mandated quarantines left people at home. This shifted and increased demand from services to goods and home delivery requirements. Keeping up with the demand was proven to be challenging due to workplace outbreaks and quarantined employees, which led to shutdowns at material suppliers and manufacturing plants. These companies struggled without employees working to fulfill the increasing demands of consumers, and these struggles can still be seen today. This is a direct reason why we find ourselves with a raw materials shortage in several industries, including flexible packaging.
Throughout the pandemic shipping problems have been prevalent. Shipping backups at big U.S. ports are not likely to resolve themselves until well into 2022. Relief could arrive eventually, however until then backlogs will continue to rise and shipping costs will elevate. The distribution of shipping containers around the world is imbalanced, with some regions having too many, and others not having enough. This shortage paired with staff shortages is threatening the effectiveness of global freight.
Add in accidents such as the Suez Canal blockage and ships being stuck in port due to delays in unloading and you’ll further see why packing supplies have become so sought after, yet hard to find.
Sustainability Challenges
It’s no secret that ideal waste management means zero-fault packaging, however, this is easier said than done. To adapt to sustainable business models, packaging production will need to process more advanced substrates, more demanding designs, and thinner materials – all without compromising on productivity and adding more flexibility at the same cost. Customers can be fickle, and brands do not want to give them a reason to try a competitor’s product instead. While the demand is switching to sustainable packaging, consumers are still expecting an equally good experience as they’ve had in the past, which presents challenges. If your brand strays too far from what consumers are used to, you’ll lose revenue, but ignoring the call to sustainable packaging can have the same effect.
Popular brands such as Calvin Klein, LUSH, and PUMA recently made the switch to sustainable packaging. For example, Puma now provides customers with shoe boxes that use significantly less cardboard with the same red, green or black holistic look. In addition to that, PUMA has also reduced the amount of consumer-facing plastic bags used in stores. While their bags are already made up of 80% recycled content in 2021 alone they’ve cut their plastic use in half saving an estimated 200 tons.
Staffing and Workforce Education
Finding talented individuals that fully understand the industry can be a challenge. Especially after the shift, the COVID-19 pandemic has brought to the workforce. Now it’s particularly difficult for companies to find the ideal candidates for the job. This isn’t due to a lack of candidates; rather, challenges that were prevalent before the pandemic was brought to light. For example, job candidates are placing more emphasis on job flexibility and mental health. With the high demands in the packaging industry, it can be difficult to meet those preferences. Jobs in the industry are also sometimes deemed as less popular due to the manual labor, however, a move towards digital solutions across the production chain will improve that.
After surveying printers and converters to identify the staffing-related challenges printers face (64%), it was reported that a lack of interest in the industry has a major or moderate effect on their organization’s ability to staff their operations. Providing proper education to potential job candidates will increase their awareness of the packaging industry and help to bring new people on board.
How Korpack is Navigating These Challenges
Although the industry is facing various challenges, Korpack is still committed to simplifying packaging solutions through speed, technology, and trust. We promise to remain fearless and adaptable, to implement simplicity, and focus on being technology-driven.
As leaders in the packaging space, Korpack is here to support our customers through the good times and the bad. To learn more about our services, get in touch with us through the form below.
